2008 Half-Yearly Results...2008 Half-Yearly Results 28 August 2008 1 Foreword For comparison purposes, 2007 data have been restated to take into account the changes in the scope of

2008 Half-Yearly Results

28 August 2008

1

Foreword

For comparison purposes, 2007 data have been restated to take into account

the changes in the scope of consolidation

the recording of the economic effects connected with discontinued operations in its specific caption

P&L data do not include Pravex-Bank (whose acquisition was finalised on 27.06.08)

2

1H08 Net Income more than €3.1bn (+22.4% vs 1H07 adjusted(1))

Adjusted Operating Margin(2) up 8.0% vs 1H07

Significant reduction in Operating costs (-2.8% vs 1H07(3))

Cost of credit contained (19bps not annualised)

Net Doubtful Loans/Loans stable at 0.9%

~€2.4bn reserves on Performing Loans

Excellent liquidity profile strengthened: Direct customer deposits > Loans to customers and positive Net interbank position of €8.3bn

Unification of IT systems successfully completed in mid-July

Continuous enlargement of customer base: ~100,000 new customers on a net basis in Italy in 1H08 (~200,000 in the whole of 2007)

Sound operating performance in the crucial phase of theIT integration and in a difficult market environment

(1) Excluding Profits on trading, non-recurring recoveries on the allowance for Employee Termination Indemnities (TFR) (€278m in 2Q07), income from Rovelli settlement (IMI-SIR; €67m in 2Q08), integration charges, amortisation of acquisition cost, income from discontinued operations and capital gain on Agos disposal (€268m in 2Q08)

(2) Excluding Profits on trading, non-recurring recoveries on the allowance for Employee Termination Indemnities (TFR) and income from Rovelli settlement (IMI-SIR)(3) Excluding non-recurring recoveries on the allowance for Employee Termination Indemnities (TFR)

3

1H08 vs 1H07 Net Income Strong growth excluding Profits on trading and main non-recurring items

(1) Tax estimated for Profits on trading

+5.3%

+22.4%

(€ m) (€ m)

1H07 Net Income 5,286 1H08 Net Income 3,105+ Integration charges 80 + Integration charges 389

+ Amortisation of acquisition cost 273 + Amortisation of acquisition cost 286

- Income from discontinued operations 3,038 - Income from discontinued operations 925of which of which

Capital gain on Crédit Agricole agreement 2,867 Capital gain on 198 Antitrust branches 933

- Recoveries on TFR 186 - Capital gain on Agos disposal 262

- Income from Rovelli settlement (IMI-SIR) 49

Net Income excluding non-recurring items 2,415 Net Income excluding non-recurring items 2,544- Profits on trading 561 - Profits on trading 274

Net Income adjusted 1,854 Net Income adjusted 2,270

1H07 Net Income(1)

(post-tax data)1H08 Net Income(1)

(post-tax data)

4

+6.5%

+10.9%

2Q08 vs 2Q07 Net Income Growing despite the difficult market environment


(€ m) (€ m)

2Q07 Net Income 1,320 2Q08 Net Income 1,357+ Integration charges 66 + Integration charges 68


- Income from discontinued operations 124 - Income from discontinued operations (25)of which of which

Capital gain on Crédit Agricole agreement 64 Capital gain on 198 Antitrust branches (20)

- Recoveries on TFR 186 - Capital gain on Agos disposal 262- Income from Rovelli settlement (IMI-SIR) 49

Net Income excluding non-recurring items 1,213 Net Income excluding non-recurring items 1,292- Profits on trading 277 - Profits on trading 254

Net Income adjusted 936 Net Income adjusted 1,038

2Q07 Net Income(1)

(post-tax data)2Q08 Net Income(1)

(post-tax data)

5

Excellent liquidity profile strengthenedDirect Customer Deposits higher than Loans to Customers

Direct Customer Deposits

€398.9bn(1)

Loans to Customers

€374.4bn

Loans to Customers/Direct Customer Deposits at 0.94 vs 0.97 as at 31.03.08

Positive Net interbank position of €8.3bn

(1) Excluding ~€22.5bn financial liabilities related to insurance sector

6

P&L Analysis: 1H08 vs 1H07Excellent cost reduction confirmed(1)

+22.4%excluding Profits on

trading and main non-recurring items

+2.0%excluding Profits on trading and income

from IMI-SIR settlement

-2.8%excluding recoveries

on TFR


trading, income from IMI-SIR settlement and recoveries on

TFR

+13.6%excluding Profits on trading and

main non-recurring items

(€ m)

Net interest income 5,162 5,724 10.9Dividends and P/L on investments carried at equity 156 95 (39.1)Net fee and commission income 3,341 3,137 (6.1)Profits (Losses) on trading 801 284 (64.5)Income from insurance business 300 186 (38.0)Other operating income (expenses) 86 154 79.1

Operating income 9,846 9,580 (2.7)Personnel expenses (2,723) (2,889) 6.1Other administrative expenses (1,542) (1,544) 0.1Adjustments to property, equipment and intangible assets (416) (385) (7.5)

Operating costs (4,681) (4,818) 2.9Operating margin 5,165 4,762 (7.8)

Net provisions for risks and charges (204) (77) (62.3)Net adjustments to loans (702) (712) 1.4Net impairment losses on other assets (22) (11) (50.0)Profits (Losses) on HTM and on other investments 45 297 n.m.

Income before tax from continuing operations 4,282 4,259 (0.5)Taxes on income from continuing operations (1,503) (1,310) (12.8)Merger and restructuring related charges (net of tax) (80) (389) n.m. Effect of purchase cost allocation (net of tax) (273) (286) 4.8Income (Loss) after tax from discontinued operations 3,038 925 (69.6)Minority interests (178) (94) (47.2)

Net income 5,286 3,105 (41.3)

1H07Restated

1H08 Δ%

Figures may not add up exactly due to rounding differencesNote: 1H07 figures restated to reflect the scope of consolidation for 1H08(1) Excluding non-recurring recoveries on the allowance for Employee Termination Indemnities (TFR) (€278m in 2Q07)

7

P&L Analysis: 2Q08 vs 2Q07Excellent cost reduction(1) and Net income growth

Figures may not add up exactly due to rounding differencesNote: 2Q07 figures restated to reflect the scope of consolidation for 2Q08(1) Excluding non-recurring recoveries on the allowance for Employee Termination Indemnities (TFR) (€278m in 2Q07)



+0.1%excluding Profits on trading and income

from IMI-SIR settlement

-2.6%excluding recoveries

on TFR



(€ m)

Net interest income 2,622 2,901 10.6Dividends and P/L on investments carried at equity 106 29 (72.6)Net fee and commission income 1,665 1,535 (7.8)Profits (Losses) on trading 347 259 (25.4)Income from insurance business 179 107 (40.2)Other operating income 31 101 225.8

Operating income 4,950 4,932 (0.4)Personnel expenses (1,216) (1,436) 18.1Other administrative expenses (783) (796) 1.7Adjustments to property, equipment and intangible assets (214) (194) (9.3)

Operating costs (2,213) (2,426) 9.6Operating margin 2,737 2,506 (8.4)

Net provisions for risks and charges (107) (44) (58.9)Net adjustments to loans (356) (401) 12.6Net impairment losses on assets (20) (3) (85.0)Profits (Losses) on HTM and on other investments 8 284 n.m.

Income before tax from continuing operations 2,262 2,342 3.5Taxes on income from continuing operations (778) (702) (9.8)Merger and restructuring related charges (net of tax) (66) (68) 3.0Effect of purchase cost allocation (net of tax) (137) (153) 11.7Income (Loss) after tax from discontinued operations 124 (25) n.m. Minority interests (85) (37) (56.5)

Net income 1,320 1,357 2.8

2Q07Restated

2Q08 Δ%


trading, income from IMI-SIR settlement and recoveries on

TFR

8

84% of revenues from retail activity(1)

Breakdown by business areaBreakdown by business area Breakdown by revenuesBreakdown by revenues

1H08 Operating Income

(1) Retail = Banca dei Territori Division, International Subsidiary Banks Division, Eurizon Capital and Banca Fideuram

Corporate and Investment

Banking Division11.8%

Banca Fideuram

3.6%

Public Finance1.5%

Corporate Centre3.0%

International Subsidiary

Banks Division10.9%

Eurizon Capital

1.9%

Banca dei Territori Division

67.3%

11% of revenues from International Subsidiary Banks Division

Profits on trading

3%

Net fee and commission

income33%

Dividends and P/L on

investments carried at

equity1%

Net interest income

59%

Income from insurance business

2%

Other operating income

2%

9

5,7245,162

1H07 1H08

Net Interest IncomeExcellent yearly growth confirmed and further acceleration of positive trend

Double-digit growth mainly driven by the increase in intermediated volumes with customers (average loans +9%) and the improvement in mark-down Selective growth in corporate loans focused on customers with a lower probability of default and on export

2Q08 the best quarter ever recorded2.8% increase in 2Q08 vs 1Q08 mainly due to the increase in intermediated volumes with customers and to mark-down improvement2Q08 increased market share in Direct Customer Deposits and Loans to Customers in Italy vs 1Q08Selective lending policy adopted in recent years confirmed (e.g. in SMEs segment) to deliver sustainable value creationRe-pricing activity still underway

(€ m)Quarterly AnalysisQuarterly Analysis

(€ m)

Loans Loans -- Average volumes Average volumes

Retail Italy +5.9 +7.1SMEs +5.2 +4.1Corporate +17.5 +10.7Public Finance +7.7 +2.2International Subsidiary Banks Division +26.6 +5.1

Δ% Δ € bn

Yearly AnalysisYearly Analysis

2,540 2,622 2,627 2,818 2,823 2,901

1Q0 7 2 Q0 7 3 Q0 7 4 Q0 7 1Q0 8 2 Q0 8

+10.9%

10

OperatingImpact

+425

Net Interest Income: 1H08 vs 1H0776% of growth due to customer related activity (€ m)

Net Interest Net Interest IncomeIncome

+562+562

1H08 1H08 vsvs 1H07 1H07

Volumes+313

Spread+112

Other+20

Finance andTreasury

+117

11

3,1373,341

1H07 1H08

1,5351,6021,6031,6041,6651,676

1Q0 7 2 Q0 7 3 Q0 7 4 Q0 7 1Q0 8 2 Q0 8

Net Fee and Commission IncomeCommercial policy focused on sustainable value creation

Commissions from commercial banking activities stable (€1,013m; +0.1%) due to growth in total commissions from Guarantees given, Credit/debit cards and Collection and payment services, offsetting the reduction in commissions from Current accounts due to higher placement of lower-cost products

Decrease in commissions from Management, dealing and consultancy activities (e.g. portfolio management, insurance products, placement of securities) to €1,682m (-9.7%) due to the adverse market trend and to customer risk aversion

17.4% increase in commissions abroad

2Q08 decrease vs 1Q08 due to lower placement of products with up-front fees and to lower commissions from AuM

In 2Q08 commercial policy focused on increasing Direct Customer Deposits (+€26.2bn 30.06.08 vs31.03.08)

2Q08 increase vs 1Q08 in commissions from Corporate and Investment Banking Division (+4.5%) and from International Subsidiary Banks Division (+7.0%)2Q08 performance also affected by activities related to the unification of IT systems completed in mid-July

(€ m)

Quarterly AnalysisQuarterly Analysis(€ m)

-6.1%


12

2.8

(14.3)3.9

13.2

Assets underAdministration

Direct CustomerDeposits

Assets underManagement

Total

Sound relationship with existing customer base and strong ability to attract new customers

(€ bn)

1H08 Customers1H08 Customers’’ financialfinancialassets net flows in Italyassets net flows in Italy(1)(1) New customers on a net basis in ItalyNew customers on a net basis in Italy(1)(1)

(1) Banca dei Territori Division

Positive net flows of customers’ financial assets in Italy(1) in 1H08 (+€2.8bn)

Potential growth of commissions ensuing from the switch back of Assets under Administration retained within the Group (∼€397bn) into Assets under Management

Strong increase in new customers on a net basis in 1H08 despite migration of IT systems

300,000100,000

200,000

2007 1H08 Total

~

~ ~

(No.)

13

259

25

-49

319347454

1Q0 7 2 Q0 7 3 Q0 7 4 Q0 7 1Q0 8 2 Q0 8

284801

1H07 1H08

-64.5%

(€ m)

Profits on TradingSignificant growth in 2Q08 vs 1Q08

Reduction due to the impact of the financial market crisis and the decrease in Financial assets held for trading (-€27bn; -33% 30.06.08 vs30.06.07)

1H08 Profits include €78m dividends from Financial assets available for sale (€112m in 1H07)

2Q08 solid performance despite market environment remaining difficult

2Q08 growth vs 1Q08 only partially due to dividends from Financial assets available for sale (€70m in 2Q08 vs €8m in 1Q08)

(€ m)Yearly AnalysisYearly Analysis Quarterly AnalysisQuarterly Analysis

14

Analysis of Profits on TradingStrong recovery in 2Q08

(€ m) 2Q07 4Q07 1Q08 2Q08

Total 347 -49 25 259

of which:

Customers 182 135 135 153

Capital markets & Financial assets AFS 89 143 40 156

Proprietary Trading and Treasury 76 53 -30 33

Structured credit products 0 -380 -120 -83

(excluding structured credit products)

15

Asia1%

US residential

9%

US non-residential

25%

Emerging5%

Europe60%

ASSET BACKED

15%

RMBS 16%

CMBS5%

CLO37%

CDO27%

Structured credit products High quality portfolio confirmed

Fair value sensitivity of structured credit products book: -€28m for +25bps of credit spreads

ProductsProducts

RatingRating %%Net exposureNet exposure(*)(*) ((€€mm))

Geographical areaGeographical area

US subprime -€14m 100% Investment Grade 73% Vintage ≤ 2005

VintageVintage %%31.12.0731.12.07 30.06.0830.06.08

US Subprime“Contagion” areaMonolineSuper senior Corporate RiskEuropean ABS/CDOOther

-4957261

2,4142,2241,195

-1430312

2,3382,226742

Super senior 51%

AAA 35%

AA 8%A 3%BBB 3%

Before 2005 43%

2005 30%

2006 18%

2007 9%

Only 9%US

residential

(*) As for “long” positions, 66% valued through mark-to-model (100% of unfunded positions, 15% of funded ones, 100% of monoline risk and of non-monoline packages), 18% through effective market quotes (46% funded positions) and 16% through comparable approach (39% funded positions). As for “short” positions, 65% valued through mark-to-model (100% unfunded “short” positions, see page on Structured credit products: Other (3/4)) and 35% valued through effective market quotes (100% of ABX and CMBX hedges and 100% of “short”positions of funds)

16

US SubprimeStill negative net exposure

There is a net “short” risk exposure of €14m as at 30.06.08, resulting from “long” positions of €33m and “short” positions of €47m

Note: For US subprime exposure, Intesa Sanpaolo intends products - cash investments (securities and funded CDOs) and derivative positions (unfunded CDOs) - with collateral mainly made up of US residential mortgages non-prime (i.e. Home Equity Loans, residential mortgages with B&C ratings and similar products) granted in the years 2005/06/07, irrespective of the FICO score and the Loan-to-Value, as well as those with collateral represented by US residential mortgages granted before 2005 with FICO score under 629 and Loan-to-Value over 90% (as at 30 June 2008, unchanged with respect to our disclosure dated 31 December 2007, the weight of this second product class is immaterial in Intesa Sanpaolo Group portfolio). The risk on these investments was managed and reduced via “short” positions on ABX indices(1) The ABS funded component has a AAA rating for 46%, a BBB rating for 46% and a CC rating for the remaining 8%. The original LTV ratio is at 93%, while the 30-60-

90 day average delinquency is 5%, 4% and 12% respectively. Cumulated loss on the collateral is at 17.6%. These positions are in part listed on active markets (funded ABS and ABX indices hedges) therefore valued using market quotes, and in part non-listed on active markets (funded and unfunded super senior CDOs ) thus valued using the mark-to-model approach

(2) The net nominal exposure of €169m as at 30.06.08 compares with €62m reported as at 31.03.08; the increase is mainly due to “short” positions closed on ABX indices in 2Q08

Position as at 30.06.08Position as at 30.06.08(1)(1)

(€m)

"Long" positions 243 -210 33"Short" positions 74 27 47Net position 169(2) -183 -14

Nominal valueCumulated write-downs and write-

backsRisk exposure

17

non- recurring recoverieson TFR

1,4531,5661,4861,4941,507 1,436

1Q0 7 2 Q0 7 3 Q0 7 4 Q0 7 1Q0 8 2 Q0 8

2,3922,7772,4742,4912,468 2,426

1Q0 7 2 Q0 7 3 Q0 7 4 Q0 7 1Q0 8 2 Q0 8

278

385416

1H07 1H08

1,5441,542

1H07 1H08

(€ m)

(€ m) (€ m)

(€ m)

(€ m)

Operating Costs (1/3)Costs decreasing by 2.8%(1) and Cost/Income down to 50%

Quarterly AnalysisQuarterly AnalysisYearly AnalysisYearly Analysis

Personnel ExpensesPersonnel ExpensesOperating CostsOperating Costs Personnel ExpensesPersonnel ExpensesOperating CostsOperating Costs

AdjustmentsAdjustmentsOther Administrative ExpensesOther Administrative Expenses Other Administrative ExpensesOther Administrative Expenses AdjustmentsAdjustments

2Q08 Operating Costs down 2.6% vs 2Q07(1)

Increase in Operating Costs in 2Q08 vs 1Q08 (+1.4%) due to the seasonal trend in Other Administrative Expenses and higher advertising expenses

Excellent cost reduction only benefiting from part of merger synergies, notwithstanding growth-related investments, mainly abroad (International Subsidiary Banks Division Operating Costs: +12.2%; +€58m)Operating Costs down 4.4% in Italy(1)

Cost/Income ratio at 50.3% (vs 53.1% as at 31.12.07(1))

(€ m)

(€ m)

(€ m)

191246216214202 194

1Q07 2Q07 3Q07 4Q07 1Q08 2Q08

796748965

772783759

1Q07 2Q07 3Q07 4Q07 1Q08 2Q08

4,681

278

1H07 1H08

-2.8%(1)

2,889

2,723

278

1H07 1H08

4,959

3,001 -3.7%(1)

-7.5%+0.1%

(1) Excluding non-recurring recoveries on the allowance for Employee Termination Indemnities (TFR) (€278m in 2Q07)



4,818

2,2131,216


278

18

~4,300 people exited the Group in 2007 (of which ~2,300 on 31.12.07)

~1,500 will exit the Group in 2008 (of which ~900 already left in 1H08, ~600 on 30.06.08) and 800 in 2009 (charges already recorded in 2007)

Agreements have been signed to reduce staff by another 2,500 people by 2009, of which ~550 coming from CR Firenze Group, both through the exit of employees who have already qualified for pension and a further activation of the Solidarity Allowance. The latter will give priority to applications already received which exceed the number set out in the agreement dated 1.08.07 (~1,750), with related charges (€0.4bn before tax) provisioned in 1Q08

Operating Costs (2/3) Cost reduction ahead of the 2007-2009 BP target

2007(1) vs 2006 1H08 vs 1H07(1)

CAGR target of 2006-2009 BP

-0.4%

Operating Costs reduction Operating Costs reduction vsvs 20072007--2009 BP target2009 BP target

(1) Excluding non-recurring recoveries on the allowance for Employee Termination Indemnities (TFR) (€278m in 2Q07)

-1.1%

-2.8%

19

1,245

730

290

Operating Costs (3/3)Still only part of the planned cost synergies included in Group’s results

(€ m)

2007

Cumulative cost synergies envisaged in the 2007-2009 BP (before tax)

2008 2009

~

~

~

As at 30.06.08 ~€550m cumulative synergies realised, of which:~€290m in 2007

~€140m in 1Q08

~€120m in 2Q08

Ongoing growth-related investments (i.e. staff abroad increased by ∼800 people and the foreign network by 88 branches compared with 30.06.07)

Realised as at 30.06.08 (~€550m)

20

401311

484

304356346

1Q07 2Q07 3Q07 4Q07 1Q08 2Q08

4433

270

7610797

1Q07 2Q07 3Q07 4Q07 1Q08 2Q08

702 712

1H07 1H08

20477

1H07 1H08

-62.3%

+1.4%

Net Adjustments to LoansNet Adjustments to Loans

Provisions for Risks and Charges and Adjustments to LoansLow Cost of credit confirmed

Strong decrease in Provisions for risks and charges afterhigh provisions in 20071H08 Net Adjustments to Loans/Loans at ~19bps (not annualised)Net Adjustments to Loans substantially stable and containeddue to the high loan portfolio quality resulting from the selective lending policy adopted in recent years which has been further strengthened


(€ m)

Quarterly AnalysisQuarterly Analysis

Strong decrease in 2Q08 Net Provisions for risks and charges compared with the high 2Q07 figureNet Adjustments to Loans/Loans in 2Q08 at ~11bps vs~9bps in 1Q08 (not annualised)

(€ m) (€ m)

(€ m)

Net Adjustments to LoansNet Adjustments to Loans

Net Provisions for risks and chargesNet Provisions for risks and charges Net Provisions for risks and chargesNet Provisions for risks and charges

21

3 ,3 4 63 ,2 3 73 ,14 6

4 ,3 6 74 ,2 163 ,9 72

1,59 51,3 4 61,2 2 0

11,4 6 811,0 3 110 ,74 3

5,8 9 65,79 45,53 8

1,76 61,4 9 81,3 56

Non Performing LoansHigh quality Loan portfolio confirmed

(€ m)

Gross Non Performing LoansGross Non Performing Loans Net Non Performing LoansNet Non Performing Loans

(€ m)

Net Doubtful Loans/Net Loans Net Doubtful Loans/Net Loans

DoubtfulSubstandard and RestructuredPast Due

0.9%0.9%0.9%

31.12.07 31.03.08 30.06.08

31.12.07 30.06.0831.03.08 31.12.07 30.06.0831.03.08

19,130

Net Doubtful Loans/Net Loans stable at 0.9%Doubtful Loans Coverage stable at 71% ~€2.4bn reserves on Performing Loans1H08 new Doubtful and Substandard Loans flow in Italy in line with 1H07, concentrated in Banca deiTerritori Division and equally distributed among individuals, small business and SMEsIncrease in Past Due concentrated in Leasing and in Industrial credit

8,3389,3088,799

17,637 18,323

22

Core Tier 1 ratio 5.7%

Tier 1 ratio 6.6%

Total Capital ratio 9.5%

RWA (€ bn) 389.2

Capital RatiosAdequate capital base in line with the 2007-2009 BP targets

30.06.08Basel 2

(standardised)

30.06.08 data take into consideration

- dividends of €1,850m(equal to half of €3.7bn, overall ordinary dividends to be distributed in 2009 as planned in the 2007-2009 BP)

- Carifirenze Public Offer and Pravex-Bank acquisition(-44bps and -11bps respectively on Core Tier 1 ratio vs31.03.08)

+ disposal of Agos(+11bps on Core Tier 1 ratio vs 31.03.08)

30.06.08 data do not take into consideration

+ disposal of Carifano underway(+6bps on Core Tier 1 ratio)

+ possible capital management actions(e.g. listing, partnership, disposal)

Significant benefits expected from Basel 2 IRB foundation

Potential substantial strengthening might be contributed by capital management actions on non-core assets with a total book value of ~€8bn, of which ~€4bn deducted from Core Tier 1

6% Core Tier 1 target and dividends planned in the 2007-2009 BP confirmed

23

Divisional Financial Highlights 84% of revenues from retail activity

Note: Retail activity = Banca dei Territori + International Subsidiaries Banks + Eurizon Capital + Banca FideuramFigures may not add up exactly due to rounding differences(1) Allocated capital = 6% RWA + insurance risk, allocated capital for Eurizon Capital = 6% RWA + 0.2% AuM(2) Income before tax from continuing operations/Allocated Capital (figure annualised)

(Figures as at 30.06.08)

€306mexcluding

Proprietary trading

Operating Income (€ m) 6,447 1,144 145 1,043 180 341 280 9,580

Operating Margin (€ m) 3,196 711 100 511 99 177 (32) 4,762

Cost/Income (%) 50.4 37.8 31.0 51.0 45.0 48.1 n.m. 50.3

RWA (€ bn) 182.8 114.7 15.9 33.0 0.7 4.2 37.9 389.2

Allocated Capital(1) (€ bn) 12.0 6.9 1.0 2.0 0.3 0.3 2.3 24.7

Pre-tax ROE(2) (%) 43.5 18.6 18.9 45.3 71.7 101.2 20.7 34.7

Direct Customer Deposits (€ bn) 228.0 76.4 9.0 29.0 n.m. 6.5 72.7 421.4

Loans to Customers (€ bn) 219.9 90.6 34.3 27.4 n.m. 1.0 1.2 374.4

EVA ® (€ m) 1,229 115 4 206 55 100 (56) 1,653

Banca dei Territori

EurizonCapital

Corporate & Investment

Banking

International Subsidiary

Banks

Corporate Centre / Others

TotalPublic Finance

Banca Fideuram

24

Banca dei TerritoriThe completion of the unification of IT systems will allow growth to accelerate

IT Systems unification completed in mid-July

~100,000 new customers on a net basis and €2.8bn net new customer financial assets in 1H08

Growth in Net interest income due to the improvement in mark-down and to the selective increase in average intermediated volumes with customers (Loans +5.6%)

Decline in commissions due to larger distribution of low cost current accounts and lower contribution of AuM (performance effect and customer risk aversion)

Operating Costs down 3.2%

New flow of doubtful and substandard loans stable vs 1H07

Cost/Income ratio at 50.4%Figures may not add up exactly due to rounding differences(1) 1H07 figures restated to reflect the scope of consolidation for 1H08. Data include the entire CR Firenze Group

+2.0%excluding Profits on trading and Income

from Insurance Business

(€ m)

Net interest income 3,777 4,044 7.1Dividends and P/L on investments carried at equity 56 32 (42.9)Net fee and commission income 2,177 2,052 (5.7)Profits (Losses) on trading 132 70 (47.0)Income from insurance business 297 194 (34.7)Other operating income (expenses) 49 55 12.2

Operating income 6,488 6,447 (0.6)Personnel expenses (1,997) (1,898) (5.0)Other administrative expenses (1,325) (1,319) (0.5)Adjustments to property, equipment and intangible assets (36) (34) (5.6)

Operating costs (3,358) (3,251) (3.2)Operating margin 3,130 3,196 2.1

Net provisions for risks and charges (56) (47) (16.1)Net adjustments to loans (546) (571) 4.6Net impairment losses on other assets 1 15 n.m. Profits (Losses) on HTM and on other investments 3 3 0.0

Income before tax from continuing operations 2,532 2,596 2.5

Cost / Income (%) 51.8 50.4Pre-tax ROE (%) 42.1 43.5EVA ® (€ m) 1,090 1,229

1H07Restated(1)

1H08 Δ%





25

1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q

2007 2008

Identification of Target ICT system,

operations planningand kick-off

PHASE 1

PHASE 2

PHASE 3

IT systems unification completed One IT System from mid-July, ahead of schedule

12/7/08

The critical stage of migration is over

Migrated on Group’s IT System ~1,800 branches and ~50m of customers’ relationships

~670,000 man/day effort, of which more than 150,000 for network employees (mainly training on new procedures)

Deadline previously

envisaged by the 2007-2009

BP

Preparation of infrastructure,technological application

and preparation of structures/staff

Unificationof

Intesa SanpaoloIT System

26

Eurizon CapitalStrong cost reduction in a difficult market environment

Asset Manager leader in Italy with ~€154bn of AuM

Operating income down due to the decrease in managed assets (over €26bn in 1H08)

Strong cost reduction (-5.8%) without benefiting yet from cost synergies deriving from the reorganisation of IT and back-office activities

Former Nextra activities, part of the Group since the end of 2007, fully and successfully integrated only since April 2008

Launch of the new integrated mutual fund range only since the beginning of May (reduction from 122 to 67 mutual funds)

New asset management products for the retail network starting only from June (Fondi Focus, 21 funds selected by the network for their simplicity)

Figures may not add up exactly due to rounding differences(1) 1H07 figures restated to reflect the scope of consolidation for 1H08

(€ m)

Net interest income 5 3 (40.0)Dividends and P/L on investments carried at equity 0 0 n.m. Net fee and commission income 191 173 (9.4)Profits (Losses) on trading 3 4 33.3Other operating income (expenses) 1 0 n.m.

Operating income 200 180 (10.0)Personnel expenses (31) (32) 3.2Other administrative expenses (53) (48) (9.4)Adjustments to property, equipment and intangible assets (2) (1) (50.0)

Operating costs (86) (81) (5.8)Operating margin 114 99 (13.2)

Net provisions for risks and charges (2) (1) (50.0)Net adjustments to loans 0 0 n.m. Net impairment losses on other assets 0 0 n.m. Profits (Losses) on HTM and on other investments 0 0 n.m.

Income before tax from continuing operations 112 98 (12.5)

Cost / Income (%) 43.0 45.0Pre-tax ROE (%) 65.3 71.7EVA ® (€ m) 62 55

1H07Restated(1)

1H08 Δ%

27

Corporate and Investment Banking (1/2)Positive results in a difficult market environment

Excellent increase in Net interest income sustained by the strong and selective development in average intermediated volumes with customers

Commission decrease mainly due to M&A Advisory and Equity Primary Markets activities

Strong recovery in less volatile revenues in 2Q08 vs 1Q08 (commissions +4.5% and net interest +7.6%)

Strong reduction in Operating costs (-4.4%)

Strong decrease in Net adjustments to loans

Cost/Income at 30.3% excluding Proprietary trading activity

Figures may not add up exactly due to rounding differences(1) 1H07 figures restated to reflect the scope of consolidation for 1H08. Data include results of Proprietary trading

+8.6%Excluding Profits on

trading


trading


trading

(€ m)

Net interest income 511 612 19.8Dividends and P/L on investments carried at equity 5 11 n.m. Net fee and commission income 449 433 (3.6)Profits (Losses) on trading 450 58 (87.1)Other operating income (expenses) 35 30 (14.3)

Operating income 1,450 1,144 (21.1)Personnel expenses (198) (187) (5.6)Other administrative expenses (229) (223) (2.6)Adjustments to property, equipment and intangible assets (26) (23) (11.5)


Goodwill impairment (1) (1) 0.0Net provisions for risks and charges (4) 0 n.m. Net adjustments to loans (106) (60) (43.4)Net impairment losses on other assets (1) (18) n.m. Profits (Losses) on HTM and on other investments 0 4 n.m.



1H07 1H08 Δ%Restated(1)

28

Financial Institutions and Foregin network

26%

Capital Markets 21%

Investment Banking

14%

Merchant Banking

5%

Other 4%

Corporate Relations

30%

Corporate and Investment Banking (2/2)Limited risk exposure confirmed

Income before tax from continuing operations % Breakdown as at 30.06.08 (excluding Proprietary trading)

Figures may not add up exactly due to rounding differences

(€ m)

Corporate Relations 222 264 18.8

Financial Institutions and International Network 210 233 10.7

Capital Markets 160 184 14.8

Investment Banking 123 125 1.4

Merchant Banking 60 42 (29.5)

Other 42 40 (4.3)

Total excluding Proprietary trading 817 887 8.6

Proprietary trading 68 (251) n.m.

TOTAL 885 636 (28.1)

1H07Δ%

1H08/1H07

1H08

29

Public Finance Solid growth excluding Profits on trading

11.1% growth in Net interest income also due to the increase in average customer loans (+7.7%)

Strong growth in Net fee and commission income (+11.1%) also due to the increase in Collection and payment services activity

6.3% Operating costs reduction due to lower Personnel expenses mostly due to the integration

Merger BIIS – Banca OPI effective since 1 January 2008

Cost/Income at 31.0%



trading


trading


trading

(€ m)

Net interest income 108 120 11.1Dividends and P/L on investments carried at equity 0 0 n.m. Net fee and commission income 27 30 11.1Profits (Losses) on trading 11 (5) n.m. Other operating income (expenses) 6 0 n.m.

Operating income 152 145 (4.6)Personnel expenses (19) (17) (10.5)Other administrative expenses (29) (28) (3.4)Adjustments to property, equipment and intangible assets 0 0 n.m.


Net provisions for risks and charges 0 1 n.m. Net adjustments to loans (9) (11) 22.2Net impairment losses on other assets (6) 0 n.m. Profits (Losses) on HTM and on other investments 0 0 n.m.

Income before tax from continuing operations 89 90 1.1


1H07Restated(1)

1H08 Δ%

30

International Subsidiary BanksStrong increase in volumes and in recurring revenues

Sustained growth in customer revenue lines

Strong increase in Net interest income mainly driven by the sizeable increase in average customer volumes (Loans +27% and Deposits +16%)

Strong growth in Net fee and commission income driven by commissions from Current accounts, Financing and Guarantees given, Payments and AuM

Increase in Operating costs mainly due to the planned expansion of commercial network (+88 branches) and staff (~ +800 employees)

+13.2% 2Q08 Operating margin vs 1Q08 (from €240m to €271m)

Cost/Income ratio slightly down to 51.0% despite investment in reinforcing the network



trading


trading


trading

(€ m)

Net interest income 538 645 19.9Dividends and P/L on investments carried at equity 1 0 n.m. Net fee and commission income 236 277 17.4Profits (Losses) on trading 151 125 (17.2)Other operating income (expenses) (2) (4) n.m.

Operating income 924 1,043 12.9Personnel expenses (236) (266) 12.7Other administrative expenses (180) (199) 10.6Adjustments to property, equipment and intangible assets (58) (67) 15.5

Operating costs (474) (532) 12.2Operating margin 450 511 13.6

Net provisions for risks and charges (6) (1) (83.3)Net adjustments to loans (62) (68) 9.7Net impairment losses on other assets 0 0 n.m. Profits (Losses) on HTM and on other investments 4 4 0.0

Income before tax from continuing operations 386 446 15.5


1H07Restated(1)

1H08 Δ%

31

Banca FideuramOperating performance affected by the negative market trend

More than ~€380m positive net inflow of customer financial assets driven by strong growth in Assets under Administration

Decrease in the value of total customer financial assets to €64.6bn (-€4bn vs 31.12.07) entirely due to the impact of the negative performance of financial markets

Strong growth in Net interest income mainly due to the increase in average intermediated volumes

Decline in commissions mainly due to the reduction of AuMaverage volumes

2Q08 considerable recovery in revenues (+12.6%) and in Operating margin (+29.1%) vs1Q08

4,293 Private bankers


(€ m)

Net interest income 59 79 33.9Dividends and P/L on investments carried at equity 0 0 n.m. Net fee and commission income 296 258 (12.8)Profits (Losses) on trading 4 2 (50.0)Other operating income (expenses) 0 2 n.m.

Operating income 359 341 (5.0)Personnel expenses (73) (62) (15.1)Other administrative expenses (89) (94) 5.6Adjustments to property, equipment and intangible assets (8) (8) 0.0


Net provisions for risks and charges (20) (18) (10.0)Net adjustments to loans 0 0 n.m. Net impairment losses on other assets 0 0 n.m. Profits (Losses) on HTM and on other investments 0 0 n.m.



1H07Restated(1)

1H08 Δ%

32

Conclusions

1H08 positive results in a difficult market environment combined with solid risk and liquidity profiles

Net income exceeding €3.1bn

8.0% growth in adjusted(1) Operating Margin

2.8%(2) cost reduction

Low cost of credit (19bps not annualised)

Net doubtful loans/Loans ratio stable at 0.9% and ~€2.4bn of reserve for Performing Loans

Direct Customer Deposits > Loans to Customers and positive Net interbank position

IT systems unification, completed ahead of schedule, enabling faster progress, despite the difficult market environment, to cruising speed in 2009

(1) Excluding Profits on trading, non- recurring recoveries on the allowance for Employee Termination Indemnities (TFR) (€278m in 2Q07) and income from Rovellisettlement (IMI-SIR; €67m in 2Q08)

(2) Excluding non-recurring recoveries on the allowance for Employee Termination Indemnities (TFR)

2007 2008 2009

Integration Driversfor growth in full operation

Cruising speed reached

33

Appendix

34

Total Assets 640,224 627,701 (2.0)

Loans to Customers 350,152 374,376 6.9

Direct Customer Deposits 392,858 421,435 7.3

Indirect Customer Deposits 689,619(1) 645,449 (6.4)

Customer Financial Assets(2) 1,053,401 1,040,695 (1.2)

Note: 30.06.07 figures restated to reflect the scope of consolidation as at 30.06.08(1) Net of GEO fund, sold in July 2007(2) Net of duplications between Direct Customer Deposits and Asset Management

of which Assets under Management 282,423 248,726 (11.9)

(€ m)Δ%%

RestatedRestated30.06.0830.06.0730.06.07

Key AggregatesExcellent liquidity profile and sound growth in Direct Customer Deposits and Loans to Customers

+9%average

customer volumes

+9.3%excluding

repurchase agreements

Direct Customer Deposits > Loans to Customers

Indirect Customer Deposits decrease due to performance effect

35

(€ m)

Net interest income 2,540 2,622 2,627 2,818 2,823 2,901Dividends and P/L on investments carried at equity 50 106 63 86 66 29Net fee and commission income 1,676 1,665 1,604 1,603 1,602 1,535Profits (Losses) on trading 454 347 319 (49) 25 259Income from insurance business 121 179 109 99 79 107Other operating income (expenses) 55 31 63 43 53 101

Operating income 4,896 4,950 4,785 4,600 4,648 4,932Personnel expenses (1,507) (1,216) (1,486) (1,566) (1,453) (1,436)Other administrative expenses (759) (783) (772) (965) (748) (796)Adjustments to property, equipment and intangible assets (202) (214) (216) (246) (191) (194)

Operating costs (2,468) (2,213) (2,474) (2,777) (2,392) (2,426)

Operating margin 2,428 2,737 2,311 1,823 2,256 2,506Net provisions for risks and charges (97) (107) (76) (270) (33) (44)Net adjustments to loans (346) (356) (304) (484) (311) (401)Net impairment losses on other assets (2) (20) 3 (52) (8) (3)Profits (Losses) on HTM and on other investments 37 8 (1) 58 13 284

Income before tax from continuing operations 2,020 2,262 1,933 1,075 1,917 2,342Taxes on income from continuing operations (725) (778) (588) (788) (608) (702)Merger and restructuring related charges (net of tax) (14) (66) (401) (126) (321) (68)Effect of purchase cost allocation (net of tax) (136) (137) (136) 399 (133) (153)Income (Loss) after tax from discontinued operations 2,914 124 740 (6) 950 (25)Minority interests (93) (85) (88) (50) (57) (37)

Net income 3,966 1,320 1,460 504 1,748 1,357

1Q07Restated

2Q07 4Q073Q07 2Q08

(1) (4)

(2)

(3)

(5)

1Q08

(1) (4)

(2)

(3)

(5)

(6)

(7)

Quarterly P&L Analysis Revenue and Operating margin growth over the last two quarters

Note: 2007 figures restated to reflect the scope of consolidation for 2Q08(1) Including €2,803m capital gain on the Crédit Agricole transaction(2) Including €278m non-recurring recoveries on the allowance for Employee Termination Indemnities (TFR)(3) Including €169m capital gain related to Borsa Italiana(4) Including €708m capital gain on the Crédit Agricole transaction(5) Including non-recurring ~€296m for 2008 Finance Law tax rate reduction with positive effect in 2008 and ~€90m from different dividends taxation vs 2006 introduced by the 2008 Finance Law(6) Including €953m capital gain for the sale of 198 branches related to Antitrust decision (7) Including €268m capital gain for the disposal of Agos

36

+3.2%

2Q08 vs 1Q08 Net Income Growing excluding main non-recurring items


(€ m) (€ m)

1Q07 Net Income 1,748 2Q08 Net Income 1,357+ Integration charges 321 + Integration charges 68


- Income from discontinued operations 950 - Income from discontinued operations (25)of which of which

Capital gain on 198 Antitrust branches 953 Capital gain on 198 Antitrust branches (20)

- Capital gain on Agos disposal 262

- Income from Rovelli settlement (IMI-SIR) 49

Net Income excluding non-recurring items 1,252 Net Income excluding non-recurring items 1,292

1Q08 Net Income(1)

(post-tax data)2Q08 Net Income(1)

(post-tax data)

37

P&L Analysis: 2Q08 vs 1Q08Good revenue and Operating margin growth

Figures may not add up exactly due to rounding differencesNote: 1Q08 figures restated to reflect the scope of consolidation for 2Q08

(€ m)

Net interest income 2,823 2,901 2.8Dividends and P/L on investments carried at equity 66 29 (56.1)Net fee and commission income 1,602 1,535 (4.2)Profits (Losses) on trading 25 259 n.m. Income from insurance business 79 107 35.4Other operating income 53 101 90.6

Operating income 4,648 4,932 6.1Personnel expenses (1,453) (1,436) (1.2)Other administrative expenses (748) (796) 6.4Adjustments to property, equipment and intangible assets (191) (194) 1.6

Operating costs (2,392) (2,426) 1.4Operating margin 2,256 2,506 11.1

Net provisions for risks and charges (33) (44) 33.3Net adjustments to loans (311) (401) 28.9Net impairment losses on assets (8) (3) (62.5)Profits (Losses) on HTM and on other investments 13 284 n.m.

Income before tax from continuing operations 1,917 2,342 22.2Taxes on income from continuing operations (608) (702) 15.5Merger and restructuring related charges (net of tax) (321) (68) (78.8)Effect of purchase cost allocation (net of tax) (133) (153) 15.0Income (Loss) after tax from discontinued operations 950 (25) n.m. Minority interests (57) (37) (35.1)

Net income 1,748 1,357 (22.4)

1Q08Restated

2Q08 Δ%

38

186300

1H07 1H08

1077999109

179121

1Q0 7 2 Q0 7 3 Q0 7 4 Q0 7 1Q0 8 2 Q0 8

Income from Insurance BusinessPerformance affected by the difficult market environment

(€ m)

Yearly AnalysisYearly Analysis(€ m)

Quarterly AnalysisQuarterly Analysis

Decrease mainly due to the reduction in financial management due to the market instability that affected the whole industry from 2H07

Note: Income from Insurance Business gathers revenues from Life and Casualty companies operating in the Group

-38.0%

2Q08 increase vs 1Q08 mainly due to financial management

39

112 . 7 10 6 . 1 10 2 . 75 2 . 1 4 3 . 6

4 . 9 0 . 910 . 911. 117 . 0

Hunga

ryCroa

tiaSlov

akia

Serbia

Egypt

Sloven

iaRus

sian F

ed.

Albania

Roman

iaBos

nia

-3.1+4.3 +29.8 +128.7 +8.2 -1.8 -11.7 +109.2 +27.0 +89.5

3 7 . 0 2 5 . 3 10 . 7 8 . 19 . 04 2 . 64 2 . 7

10 3 . 0114 . 212 3 . 2

Hunga

ryCroa

tiaSlov

akia

Russia

n Fed

.Serb

iaEgy

ptSlov

enia

Roman

iaAlba

niaBos

nia+8.9 +8.3 +12.3 +49.2 +5.4 +8.0 +7.9 +32.4 +9.7 +16.4

14 3 . 2115 . 7 110 . 8

6 7 . 32 9 . 4

5 . 8 3 . 19 . 82 0 . 92 1. 0

Hunga

rySlov

akia

Croatia

Serbia

Egypt

Russia

n Fed

.Slov

enia

Albania

Roman

iaBos

nia

+11.1 +23.8 +0.5 +98.5 -39.0 +14.0 +15.4 +78.1 +56.7 +3.4

6 3 . 7 4 6 . 218 . 8 11. 116 . 5

6 6 . 410 9 . 9

2 18 . 72 2 5 . 02 6 6 . 5

Hunga

ryCroa

tiaSlov

akia

Serbia

Egypt

Russia

n Fed

.Slov

enia

Albania

Roman

iaBos

nia

+10.1 +4.3 +18.1 +47.9 -19.5 +35.4 +11.2 +37.2 +40.1 +12.5

International Subsidiary BanksFigures by Country 1H08 vs 1H07

(1) Income before tax from continuing operations

Operating CostsOperating CostsOperating IncomeOperating Income

PrePre--Tax IncomeTax Income(1)(1)Operating MarginOperating Margin

(€ m) (€ m)

(€ m) (€ m)

Δ% Δ%

Δ%Δ% Δ%

Croatia and Egypt performance affected by the decrease in Profits on trading

40

Structured credit products: US SubprimeExposure still negative

(1) The column “Risk exposure” sets out: for securities, fair value; for derivatives, the nominal value of the contract, net of capital gains and losses recorded at the date of reference. Such amounts correspond, for “long” positions, to the maximum potential loss (in the event of 100% default and recovery rate of 0). For “short” positions, viceversa, they indicate the maximum potential gain (in the same scenario in terms of default and recovery level)

(2) With mezzanine collateral. Including a position with underlying assets made up for approximately one third of subprime mortgages. This table includes the sole portion represented by subprime mortgages, whereas the residual exposure is reported in the “contagion” area

(3) Risk position of the Romulus vehicle (fully consolidated entity), classified in securities available for sale. The relevant fair value decrease was recorded in the specific Reserve under Shareholders’ equity. Romulus is an asset-backed commercial paper conduit vehicle, set up to offer customers an alternative financial channel via access to the international commercial paper market.As at 30.06.08, the portfolio of investments included €280m of financial assets available for sale and €967m of loans to customers. Of the €280m of securities, €9m were attributable to the US subprime segment, €16m to the “contagion” area (see page on “Contagion” area (2/4), Multisector CDOs), €255m to other structured credit products (see page on Other (4/4)). Negative fair value changes recorded on securities available for sale totalled €41m and were recorded in the specific Reserve under Shareholder’ equity, of which -€3m recorded on positions included in the subprime segment, -€4m on positions attributed to the so-called “contagion” area (see page on “Contagion” area (2/4), Multisector CDOs), -€34m on securities which fall under other structured credit products (see page on Other (4/4))

(€m)

Funded ABS 22 3 -19 -1 -3 -4 -2Funded CDOs 24 1 -23 -5 -5 -1 Unfunded super senior CDOs(2) 188 23 -165 -18 -18 -6

Other(3) 9 6 -3

"Long" positions 243 33 -210 -1 -26 -27 -9ABX hedges 74 47 27 87 -66 21 2

"Short" positions 74 47 27 87 -66 21 2Net position "long" 169 "short" 14 -183 86 -92 -6 -7

Nominal valueProduct

30.06.08 income statementProfits (Losses) on trading

Position as at 30.06.08

Realised gains/losses

1H08

Total income statement

of which 2Q08

Risk exposure (including write-

downs and write-backs)(1)

Write-downs and write-backs

Cumulated write-downs

and write-backs

41

Structured credit products: Monoline (1/2)No material exposure

No direct exposure but only indirect positions connected to hedging derivatives purchased from monoline insurers to buy protection on the default risk of assets held by the Group, which therefore only generate counterparty risk(1). Such hedging derivatives are part of two types of activities performed by Intesa Sanpaolo: packages(2) and fully hedged(3) credit derivatives transactions

(1) For the sake of completeness, please note that there is another form of exposure to monoline insurers, which does not generate particular risk situations. It stems from the investment in securities for which the monoline insurer provides a credit enhancement to the issuing vehicle, for the purpose of making the issue “eligible” for certain types of investors through the achievement of a certain rating (normally AAA). Such securities, wholly held by Banca Infrastrutture Innovazione e Sviluppo, nominal value as at 30 June 2008 of €524m (€1,273m as at 31 December 2007) are made up for 77% of ABS with underlying Italian health receivables and for the remaining portion of financings of infrastructures; they are all recorded in the banking book, for approximately 80% in the Loans & Receivables (L&R) portfolio and for the remaining portion of securities available for sale. The strong decrease in nominal value is due to the total reimbursement of two health receivables securitisations towards regions occured in the semester. The positions were granted on the basis of the creditworthiness of the underlying borrower and, therefore, irrespective of the credit enhancement offered by the monoline insurer. It must be noted that, as of today, no deterioration in the creditworthiness of the single issuers/borrowers has arisen to suggest any particular actions such as the allocation of prudential provisions. In this respect, it must be noted that all issues are Investment Grade and that ABS with underlying Italian health receivables are also assisted by delegated regional payment

(2) Both the security and the connected derivative have been valued with the mark-to-model methodologies, also considering any available prices, if lower; such valuation did not have any impact on Profits (Losses) on trading, with the exception of those referred to the counterparty risk component, mostly due to transactions in which the hedge was stipulated with monoline insurers, for which a credit risk adjustment has been calculated, determined on the basis of the cost of protection CDS on the default of the monoline insurer, with nominal value equal to the current and potential future exposure (so-called add-on) and expiry equal to the average residual life of the underlying assets. Even though packages do not lead to market risk connected with the nature of the underlying asset, for the sake of completeness, please note that, assets which are part of packages include, for €163m nominal value as at 30.06.08, securities with US RMBS collateral with a significant subprime content (equal to 32.9%)

(3) Intesa Sanpaolo’s activities in fully hedged derivatives are made up of the simultaneous purchase and sale of protection on the same reference entity (underlying asset) with two different counterparties. Also in this case activities do not expose to the market risk generated by the underlying asset, but with the sole counterparty risk generated by the “short”position in the protection purchase, further mitigated by the fact that Intesa Sanpaolo has a right of substitution of monoline insurer, which is however prudently not considered in the valuation

(4) Write-downs

Monoline

Net counterparty risk exposure totalled €12m as at 30.06.08 (€61m as at 31.12.07)

1H08 income statement impact(4) -€34m (2007 -€25m)

62% vs MBIA

38% vs other monoline with rating between AAA and BBB

42

Structured credit products: Monoline (2/2)No material exposure

(1) Underlying assets other than US RMBS, both European and US

(€m)

Positions in Packages:US RMBS with a significant Subprime content 163 119 44 4 -40 -27 -22

Other underlying assets(1) 43 40 3 -3 -2 -1

Sub-Total 206 159 47 4 -43 -29 -23Positions in other derivatives:Other underlying assets 300 276 24 8 -16 -5 -3Total 506 435 71 12 -59 -34 -26

Nominal value of the

underlying asset


Credit risk exposure to monoline insurers (fair value of the CDS)

pre write-down 1H08

Fair value write-down of the hedge from monoline insurers

of which 2Q08

Fair valueof the

underlying asset

Credit risk exposure to monoline insurers (fair value of the CDS)

post write-down


Fair value cumulated write-

downs of the hedge from monoline

insurers

43

100% AAA Rating100% 2005 Vintage65% average original LTV0.7% cumulated loss30-60-90 day average delinquency is 0.5%, 0.3% and 0.2%

respectivelyValued on the basis of effective market quotes

Rating positions unfunded AA and A+, funded AAAAverage Attachment point 43%Written down for 56% of the nominal value on the basis of the mark-to-model

100% AAA Rating100% 2005 VintageNo Agency component: 70% average original LTV, 0.8% cumulated loss, 30-60-90 day average delinquency is 3%, 1% and 2% respectivelyValued on the basis of effective market quotes

TruPSNet risk exposure totalled €92m as at 30.06.08 (€146m as at 31.12.07)1H08 income statement impact(1) -€40m (2007-€85m)

Collateral: 57% US RMBS (for 59% vintage prior to 2005 and an average 4.1% exposure to subprime); 20.7% European ABS; 9.2% CMBS; 4.3% HY CBO; 1.1% Consumer ABSRating: 66% AAA and 34% AAverage Attachment point 32%Written down for 24% of the nominal value on the basis of the mark-to-model

Structured credit products: “Contagion” area (1/4)Good quality of structures

Multisector CDOs: such products are almost entirely present in unfunded super senior CDOs, with collateral represented by US RMBS, European ABS, CMBS, HY CBO and Consumer ABS

Multisector CDOs€268m “long” positions as at 30.06.08, including €17m CMBX indexes hedging introduced in 2Q (€393m as at 31.12.07), against which there are investments in funds with “short” positions on the US credit market of €177m (€115m as at 31.12.07)1H08 income statement impact(1) -€13m(2007 -€17m)

Alt-A – Alternative A Loans: ABS (securities) with underlying US residential mortgages normally of high quality characterised however by penalising factors, mostly for incomplete documentation, which do not permit their classification in standard prime contracts

Alt-ANet risk exposure totalled €75m as at 30.06.08 (€93m as at 31.12.07)

1H08 income statement impact(1) -€2m (2007 -€28m)

TruPS – Trust Preferred Securities of REITs (Real Estate Investment Trust): financial instruments similar to preferred shares issued by real estate-trustee to finance residential or commercial initiatives present almost entirely in Unfunded super senior CDOs

Prime CMOs: securities issued with guarantee mostly represented by loans assisted by mortgages on US residential buildings

(1) Including realised gains/losses and write-downs/write-backs

Prime CMOsNet risk exposure totalled €45m as at 30.06.08 (€55m as at 31.12.07)1H08 income statement impact(1) -€3m(2007 -€1m)

44

Structured credit products: “Contagion” area (2/4)Multisector CDOs

(1) Risk position of the Romulus vehicle (fully consolidated entity), classified in securities available for sale. The relevant fair value decrease was recorded in the specific Reserve under Shareholders’ equity (see page on US subprime, note 3)

(2) Nominal value and risk exposure data do not include amounts of “short” positions of funds

(€m)

Unfunded super senior CDOs 357 273 -84 -32 -32 -17Other (funded)(1) 16 12 -4

"Long" positions 373 285 -88 -32 -32 -17CMBX hedges 25 17 8 -6 8 2 2

"Short" positions of funds 131 177 46 17 17 8Net position(2) "long" 348 "long" 268 -34 -6 -7 -13 -7


30.06.08 income statementProfits (Losses) on tradingPosition as at 30.06.08


1H08


of which 2Q08


downs and write-backs)

Write-downs and write-

backs


and write-backs

45

Structured credit products: “Contagion” area (3/4)Alt-A

(1) Risk position classified in securities available for sale, belonging to the Parent company, coming from the Romulus vehicle, transferred at fair value in 2008

(€m)

Alt-A Agency 44 43 -1 -1 -1

Alt-A No Agency 39 32 -7 -1 -1

Other(1) 8

"Long" positions 91 75 -8 -2 -2





1H08


of which 2Q08





and write-backs

46

Structured credit products:“Contagion” area (4/4)TruPS and Prime CMOs

(€m)

Funded CDOs 3 3Unfunded super senior CDOs 208 89 -119 -40 -40 -16

"Long" positions 211 92 -119 -40 -40 -16




1H08


of which 2Q08





and write-backs

TruPS

Prime CMOs

(€m)

CMOs (Prime) 49 45 -4 -3 -3 -3

"Long" positions 49 45 -4 -3 -3 -3





1H08


of which 2Q08





and write-backs

47

Structured credit products: Other (1/4)High quality of structuresThe effects of the crisis that affected the US financial markets progressively spread involving initially instruments with collateral made up of US non-subprime residential mortgages and subsequently the whole structured credit products segment, including products with non-US underlying assets.Details of different type of products related to this segment are provided below: in particular, non-monoline packages, funded ABS/CDOs, unfunded super senior Multisector CDOs not comprised in the “contagion” area, Super Senior Corporate Risk and Other unfunded positions:

■ Non-monoline packages: assets with specific hedges stipulated with primary international banks(1)

(1) Underlying assets were mostly made up of CLOs and ABS CDOs with a limited portion of US subprime (equal to approximately 22%)(2) Write-downs(3) Including realised gains/losses and write-downs/write-backs

Packages

Net exposure to counterparty risk €197m as at 30.06.08 (€454m as at 31.12.07)

1H08 income statement impact(2) -€3m(2007 -€5m)

Hedges from banks generally with a AA rating (in one case AAA and in one case A rating) mostly object of specific collateral agreementsValued using the mark-to-model approach

■ Unfunded super senior Multisector CDOs: this component includes super senior positions with High-Grade, widely diversified collateral or characterised by high credit quality RMBS and therefore not included in the “contagion” area

Unfunded super senior Multisector CDOsnot included in the “contagion” area

Net risk exposure €683m as at 30.06.08(€743m as at 31.12.07)1H08 income statement impact(3) -€5m(2007 -€16m)

28% collateral in CMBS, 40% corporate loans, 21.4% average US RMBS and 3.2% average subprime100% AAA Rating89% Vintage prior to 200518.1% average Attachment pointValued using the mark-to-model approach

48

US funded ABS/CDOs: portfolio includes securities with US underlying assets, with collateral mostly represented by Credit Card. It is also present a CMBS component with underlying 100% Small Commercial Loans with 100% AAA rating

Structured credit products: Other (2/4)High quality of structures

European funded ABS/CDOs: portfolio with collateral diversified in RMBS/CMBS, CLOs, CDOs and ABS of receivables (Credit Card, Leasing, Personal Loans, etc)

European funded ABS/CDOs

Net risk exposure €2,226m as at 30.06.08 (€2,224m as at 31.12.07)1H08 income statement impact(1) -€60m(2007 -€78m)

Funded ABS/CDOs ascribable to the Romulus vehicle: securities classified in available for sale with mainly US underlying assets (Credit Card, Leveraged Loans, Student Loans)

US funded ABS/CDOs RomulusNet risk exposure €221m as at

30.06.08 (€263m as at 31.12.07)


Rating: 79% AAA, 19% AA/A, 2% BBB/BB

Valued on the basis of effective market quotes for 41%, comparable approach for 43%, mark-to-model for 16%

Collateral: 34% RMBS (of which ∼47% Italy)25% CLO mainly SMEs15% CDO11% CMBS (of which 44% Offices, 27% Retail/Shopping Centres, 10% Mixed Use, 8% Nursing Homes, 6% Residential, 4% Industrial) 15% ABS of receivables

Collateral: 62.8% Credit Card, 21.9% CMBS, 15.3% High Yield CLORating: 56% AAA, 28% AA/A, 16% BBBValued on the basis of effective market quotes for 85%, mark-to-model for 15%

Rating: 99% AAA

Valued on the basis of effective market quotes

US funded ABS/CDOsNet risk exposure €86m as at 30.06.08

(€139m as at 31.12.07)1H08 income statement impact(1) -€7m (2007 -€15m)

49

Unfunded super senior Corporate Risk CDOsNet risk exposure €2,338m as at 30.06.08(€2,414m as at 31.12.07)1H08 income statement impact(1) -€15m(2007 -€71m)

Structured credit products: Other (3/4)High quality of structures

Unfunded super senior Corporate Risk CDOs: super senior in this category are mostly characterised by collateral subject to corporate risk

Other unfunded positions: portfolio with a “short” balance of unfunded CDOs with mainly European underlying assets

Almost entirely on mezzanine tranches

Valued using the mark-to-modelapproach


Collateral: 34.1% US (mainly CLOs)37.6% Europe (44% consumer credit Italy and 38.5% CLOs)28.3% Emerging Markets (Bonds and Project Finance)

Valued using the mark-to-model approach

Other unfunded positionsNet risk exposure -€445m as at 30.06.08 (-€404m as at 31.12.07)1H08 income statement impact(1) -€15m (2007 +€2m)

37% average attachment point

50

Structured credit products: Other (4/4)

(1) Underlying assets were mostly made up of CLOs and ABS CDOs with a limited portion of US subprime (equal to approximately 22%)(2) According to systematic adjustments made on the entire derivatives’ universe to incorporate the credit risk in the fair value, in this particular case minimum, of the

counterparty (so-called credit risk adjustment), even considering that the operations are mainly object of specific collateral agreement(3) Of which €655m belonging to Banca IMI and €10m belonging to CR Firenze, the latter classified in securities available for sale(4) Of which -€5m ascribable to Banca IMI(5) Including a portfolio with a “short” balance of unfunded CDOs of -€434m of nominal value and -€445m of fair value(6) Risk position of the Romulus vehicle (fully consolidated entity), classified in securities available for sale. The relevant fair value decrease was recorded in the specific

Reserve under Shareholders’ equity (see page on US subprime, note 3)

(€m)

Funded ABS/CDO 2,447 2,312 -135 -5 -62 -67 -1Unfunded super senior multisector CDOs and corporate risk(5) 2,689 2,576 -113 1 -36 -35 -19

Other(6) 255 221 -34

Nominal value Product




1H08


of which 2Q08

Fair value Write-downs and write-backs

(4)


and write-backs

(4)(3)

(€m)

Non-monoline packages(1) 1,474 1,269 205 197 -8 -3 -4

Nominal value of the

underlying asset


1H08

Fair value write-down of the hedge from primary International banks

of which 2Q08

Fair valueof the underlying

asset

Credit risk exposure to primary International

banks (fair value of the CDS) pre write-down

Credit risk exposure to primary International

banks (fair value of the CDS) post write-down

Product

Fair value cumulated write-downs of the hedge from primary international banks

(2)

51

No. Transactions Amount(1)

Leveraged FinanceContained and high quality exposure

103 €5,092m

Italy 74%

Abroad26%

Senior 91%

Subordinated 9%

Final Take73%

To be syndicated27%

(*) Group’s financing to parties controlled by private equity funds (1) Outstanding commitment

(*)

Breakdown

Abroad2%

Italy 25%

Telecom31%

Industrial44%

Services23%

Financial2%

52

Disclaimer

“The manager responsible for preparing the company’s financial reports, Ernesto Riva, declares, pursuant to paragraph 2 of Article 154-bis of the Consolidated Law on Finance, that the accounting information contained in this presentation corresponds to the document results, books and accounting records”.

* * *This presentation contains certain forward looking statements and forecasts reflecting Intesa Sanpaolo management’s current views with respect to certain future events. The Intesa Sanpaolo Group’s ability to achieve its projected results is dependent on many factors which are outside management’s control. Actual results may differ materially from those projected or implied in the forward-looking statements. Such forward-looking information involves risks and uncertainties that could significantly affect expected results and is based on certain key assumptions.

The following important factors could cause the Group’s actual results to differ materially from those projected or implied in any forward-looking statements:

• the Group’s ability to successfully integrate the employees, products, services and systems of the merger of Banca Intesa S.p.A. and Sanpaolo IMI S.p.A. as well as other recent mergers and acquisitions;

• the impact of regulatory decisions and changes in the regulatory environment;• the impact of political and economic developments in Italy and other countries in which the Group operates;• the impact of fluctuations in currency exchange and interest rates; and• the Group’s ability to achieve the expected return on the investments and capital expenditures it has made it Italy and in foreign

countries.

The foregoing factors should not be construed as exhaustive. Due to such uncertainties and risks, readers are cautioned not to place undue reliance on such forward-looking statements, which speak only as of the date hereof. Accordingly, there can be no assurance that the Group will achieve its projected results.

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